30th Oct 2015 07:00
For release at 07:00 on 30 October 2015
Nakama Group plc (AIM: NAK)
("Nakama" or "the Group")
"The AIM quoted recruitment consultancy working across UK, Europe, Asia and Australia providing staff for the Web, Interactive, Digital media, IT and Business Change sectors
announces its interim results for the six months ended 30 September 2015"
INTERIM RESULTS
Highlights
· Profit before tax £169,000 (2014: profit £222,000)
· Net fee income (NFI) rose by 11% to £3.0 million (2014: £2.7 million)
· NFI increased to 28% (2014: 25%)
· Permanent recruitment fees increased by 32.1% to £1.75 million (2014: £1.33 million)
· Revenue across the APAC region increased by 18.4%*
*On constant currency the increase would have been 27%
Rob Sheffield, CEO of Nakama, commented:
"Since September we have conducted a widespread review of all Group operations with a specific emphasis on sales. The Group strategy for growth in all regions is a key focus aligning all offices and enabling the business to grow globally".
Enquiries:
Nakama Group plc Rob Sheffield, CEO Ken Ford, Chairman | www.nakamaglobal.com Tel: 0061 498 127 326 Tel: 07884 313191 |
WH Ireland Limited Paul Shackleton (NOMAD) Johnny Martin Smith (Broking) |
Tel: 0207 220 1666 |
Peckwater PR Tarquin Edwards | Tel: 07879 458 364 |
NOTES TO EDITORS
About Nakama Group plc
Nakama Group plc is a recruitment group of two branded solutions placing people into specialist and management positions;
· Nakama operates in the digital, creative, media, marketing and technology sectors all over the world from offices in the UK, Asia and Australia.
· The Highams brand specialises in the Financial Services sector, specifically Business Change and IT in Insurance and Wealth Management currently in the UK and Europe.
Nakama Group plc was created in October 2011 through the merging of Nakama Ltd UK and its subsidiaries in Hong Kong, Sydney and Melbourne and Highams Recruitment Limited (formerly Highams Systems Services Group plc).
Since forming in 2011, the Group has opened an office in Singapore for Digital, Creative, Media and Marketing.
Our aim is to offer all our services from both our brands in all our locations.
CEO'S STATEMENT
Interim results
Introduction
Nakama provides a range of specialist recruitment services to its clients, providing staff for the Web, Interactive, Digital Media, IT and Business Change sectors through the placement of contract and permanent staff across the UK, Europe, Asia and Australia.
The Group revenue of £10.6 million (2014: £11.1 million) shows a small decrease but with an increase in Net Fee Income (NFI) to £3.0 million (2014: £2.7 million). As a percentage of Revenue, NFI increased to 28 per cent. (2014: 25 per cent).
Segmental analysis shows that we have increased our revenue in the APAC region whilst UK revenues have decreased slightly. We have seen NFI increase due to a shift away from low margin contract business to higher permanent placements ("Perm") in our specialist sectors. Staff levels across the Group have risen in all offices which is reflected in an increased staff cost.
We are currently in line with our expectations for the first half of the year and we anticipate no significant changes in trading in the second half. The business continues to focus on quality of service and the professional delivery of our products to our customers. A key focus is to continue to improve contract margins and drive Perm revenues whilst growing our headcount and providing industry specific training. We have seen some impact by Foreign Exchange losses on revaluation of intercompany debt for the first half of the year (£37k).
Summary
Since September we have conducted a widespread review of all Group operations with a specific emphasis on sales. "The Group strategy for growth in all regions is a key focus aligning all offices and enabling the business to grow globally"
Rob Sheffield
CEO
30 October 2015
| Consolidated statement of comprehensiveincome | ||||||||||||||
| for the six months ended 30 September 2015 |
6 months to | 6 months to | 12 months to | |||||||||||
| 30 Sep 2015 | 30 Sep 2014 | 31 Mar 2015 | ||||||||||||
| Unaudited | Unaudited | Audited | ||||||||||||
| Note | £'000 | £'000 | £'000 | |||||||||||
| |||||||||||||||
| Total Revenue | 3 | 10,649 | 11,089 | 21,715 | ||||||||||
| |||||||||||||||
| Cost of sales | (7,636) | (8,388) | (16,394) | |||||||||||
| Net Fee Income | 3,013 | 2,711 | 5,321 | |||||||||||
| Administrative costs | (2,827) | (2,467) | (4,985) | |||||||||||
| |||||||||||||||
| Operating profit | 3 | 186 | 244 | 336 | ||||||||||
| Finance costs | (17) | (22) | (39) | |||||||||||
| Profit on ordinary activities before taxation | 169 | 222 | 297 | |||||||||||
| Tax expenses | 0 | 2 | (53) | |||||||||||
| Profit for the period attributable to equity shareholders | 169 | 224 | 244 | |||||||||||
| |||||||||||||||
| |||||||||||||||
| Basic Profit per share | 0.14 | p | 0.19 | p | 0.21 | p | ||||||||
| Diluted Profit per share | 0.13 | p | 0.19 | p | 0.19 | p | ||||||||
| |||||||||||||||
| |||||||||||||||
| |||||||||||||||
| |||||||||||||||
| Consolidated statement of recognised income and expense |
| |||||||||||||
| for the 6 months ended 30 September 2015 | 6 months to | 6 months to | 12 months to | |||||||||||
| 30 Sep 2015 | 30 Sep 2014 | 31 Mar 2015 | ||||||||||||
| Unaudited | Unaudited | Audited | ||||||||||||
| £'000 | £'000 | £'000 | ||||||||||||
| Profit for the period | 169 | 224 | 244 | |||||||||||
| Exchange gains/(losses) arising on translation of foreign operations | 10 | (9) | (8) | |||||||||||
| Total recognised income and expense for the period attributable to equity shareholders | 179 | 215 | 236 | |||||||||||
| |||||||||||||||
| |||||||||||||||
Statement of changes in equity
At 30 September 2015
Share capital | Share premium | Merger reserve | Employee share benefit reserve | Currency Reserve | Retained earnings | Total equity | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 April 2014 | 1,602 | 2,580 | 90 | (61) | 73 | (2,652) | 1,632 |
Comprehensive income for the year | |||||||
Profit for the Year | - | - | - | - | - | 244 | 244 |
Other Comprehensive Income | - | - | - | - | (8) | - | (8) |
Total Comprehensive profit for the year | - | - | - | (8) | 244 | 216 | |
Share based payment credit | - | - | - | - | - | 7 | 7 |
At 1 April 2015 | 1,602 | 2,580 | 90 | (61) | 65 | (2,401) | 1,875 |
Income for the year | - | - | - | - | - | 169 | 169 |
Other comprehensive income | - | - | - | - | 10 | - | 10 |
Total Comprehensive income for the year | 1,602 | 2,580 | 90 | (61) | 75 | 169 | 179 |
Share based payment credit | - | - | - | - | - | - | - |
At 30 September 2015 | 1,602 | 2,580 | 90 | (61) | 75 | (2,232) | 2,054 |
Consolidated statement of financial position | ||||
As at 30 September 2015 | ||||
6 months to | 6 months to | 12 months to | ||
30 Sep 2015 | 30 Sep 2014 | 31 Mar 2015 | ||
Unaudited | Unaudited | Audited | ||
£'000 | £'000 | £'000 | ||
Assets | ||||
Non-current assets | ||||
Intangible assets | 761 | 940 | 848 | |
Property, plant and equipment | 70 | 40 | 67 | |
Deferred tax asset | 178 | 226 | 178 | |
Total | 1,009 | 1,206 | 1,094 | |
Current assets | ||||
Trade and other receivables | 4,281 | 3,927 | 3,514 | |
Cash and cash equivalents | 498 | 194 | 316 | |
Total | 4,779 | 4,121 | 3,830 | |
Total assets | 5,788 | 5,327 | 4,924 | |
Liabilities | ||||
Current liabilities | ||||
Trade and other payables | (2,137) | (2,273) | (1,978) | |
Borrowings | (1,597) | (1,202) | (1,071) | |
Total | (3,734) | (3,475) | (3,049) | |
Net assets/(liabilities) | 2,054 | 1,852 | 1,875 | |
Equity | ||||
Share capital | 1,602 | 1,602 | 1,602 | |
Share premium account | 2,580 | 2,580 | 2,580 | |
Merger reserve | 90 | 90 | 90 | |
Employee share benefit trust reserve | (61) | (61) | (61) | |
Currency reserve | 75 | 64 | 65 | |
Retained earnings | (2,232) | (2,423) | (2,401) | |
Total equity | 2,054 | 1,852 | 1,875 |
Consolidated Cash Flow Statement | ||||
As at 30 September 2015 | ||||
6 months to | 6 months to | 12 months to | ||
30 Sep 2015 | 30 Sep 2014 | 31 Mar 2014 | ||
Unaudited | Unaudited | Audited | ||
£'000 | £'000 | £'000 | ||
Operating activities | ||||
Profit /(loss)before taxation | 169 | 222 | 297 | |
Depreciation of property, plant and equipment | 27 | 17 | 33 | |
Amortisation of intangible assets | 88 | 96 | 192 | |
Net finance costs | 17 | 22 | 39 | |
Tax paid | - | 2 | (1) | |
Changes in trade and other receivables | (767) | (721) | (311) | |
Changes in trade and other payables | 37 | 595 | 300 | |
Net cash used in operating activities | (428) | 233 | 549 | |
Cash flows from investing activities | ||||
Purchase of property plant and equipment | (30) | (10) | (58) | |
Purchase of intangible asset | - | - | (4) | |
Proceeds from sale of assets | - | - | 1 | |
Net cash used in investing activities | (30) | (10) | (61) | |
Financing activities | ||||
Increase/(decrease) in borrowings | 526 | (117) | (469) | |
Finance cost paid | (17) | (22) | (39) | |
Net cash from financing activities | 509 | (139) | (508) | |
Net changes in cash and cash equivalents | 51 | 84 | (20) | |
Cash and cash equivalents, beginning of period | 95 | 114 | 114 | |
Exchange losses, cash and cash equivalent | 8 | (4) | 1 | |
Cash and cash equivalents at end of period | 154 | 194 | 95 | |
Cash and cash equivalents for the purposes of the Statement of cash flows comprises:
Cash and cash equivalent | 498 | 599 | 316 | |
Bank overdrafts | (344) | (405) | (221) | |
154 | 194 | 95 | ||
Notes to the Interim Report
1. Basis of Preparation
This unaudited consolidated interim financial information has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively EU IFRSs). The principal accounting policies used in preparing the interim results are those that the Group expects to apply in its financial statements for the year ended 31 March 2016 and are unchanged from those disclosed in the Group's Annual Report for the year ended 31 March 2015, except that in the current financial year, the Group had adopted a number of revised standards and interpretations. However, none of these has had a material impact on the Group's reporting.
The financial information for the six months ended 30 September 2015 and 30 September 2014 is unreviewed and unaudited and does not constitute the Group's statutory financial statements for those periods. The comparative financial information for the full year ended 31 March 2015 has, however, been derived from the audited statutory financial statements for that period. A copy of those statutory financial statements has been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498(2)-498(3) of the Companies Act 2006.
The financial information in the Interim Report is presented in Sterling and all values are rounded to the nearest thousand pounds (£'000) except when otherwise indicated.
2. Earnings per share
6 months to 30 Sept 2015 Unaudited | 6 months to 30 Sept 2014 Unaudited | 12 Months to 31 March 2015 Audited | |||||||
Weighted | Weighted | Weighted | |||||||
average | average | average | |||||||
number of | Profit | number of | Profit | number of | Profit | ||||
Profit | shares | per share | Profit | shares | per share | profit | shares | per share | |
£'000 | '000 | p | £'000 | '000 | p | £'000 | '000 | p | |
Basic earnings per share | 169 | 117,791 | 0.14 | 224 | 117,791 | 0.19 | 244 | 117,791 | 0.21 |
Diluted earnings per share | 169 | 126,469 | 0.13 | 224 | 117,791 | 0.19 | 244 | 126,571 | 0.19 |
3. Segmental Analysis
The Group has two main reportable segments based on the location revenue is derived from: | ||||||||
Asia Pacific - This segment includes Australia, Hong Kong and Singapore | ||||||||
UK -The UK Segment includes candidates placed in the UK and Europe. | ||||||||
These segments are monitored by the board of directors. | ||||||||
Factors that management used to identify the Group's reportable segments | ||||||||
The Group's reportable segments are strategic business units that although supplying the same product offerings, operate in distinct markets and are therefore managed on a day to day basis by separate teams. | ||||||||
Measurement of operating segment profit or loss, assets and liabilities | ||||||||
The Group evaluates performance on the basis of profit or loss from operations before tax not including overhead costs incurred by the head office such as plc AIM related costs not recharged, exceptional items, amortisation and share based payments. | ||||||||
The Board does not review assets and liabilities by segment.
Asia Pacific | UK | Total | |
30 Sep 15 | 30 Sep 15 | 30 Sep15 | |
£'000 | £'000 | £'000 | |
Revenue from external customers | 3,745 | 6,904 | 10,649 |
Segment profit before tax | 241 | 84 | 325 |
Asia Pacific | UK | Total | |
30 Sept 14 | 30 Sept 14 | 30 Sept 14 | |
£'000 | £'000 | £'000 | |
Revenue from external customers | 3,163 | 7,936 | 11,099 |
Segment profit before tax | 168 | 211 | 379 |
Reconciliation of reportable segment profit to the Group's corresponding amounts: | ||||||
| ||||||
30 Sept 15 | 30 Sept 14 | 31 Mar 15 | ||||
Profit or loss after income tax expense | £'000 | £'000 | £'000 | |||
Total profit or loss for reportable segments | 325 | 379 | 597 | |||
PLC costs not cross charged (restated) | (68) | (64) | (101) | |||
Amortisation of intangibles | (88) | (86) | (192) | |||
Share based payments | - | (5) | (7) | |||
Profit before income tax expense | 169 | 222 | 297 | |||
Corporation taxes | - | 2 | (53) | |||
Profit after income tax expense | 169 | 224 | 244 | |||
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